Supply chain start-ups

Why are mature companies so interested in start-ups lately? Large organizations are seeing the arrival of start-ups rapidly changing the world around them, while they themselves have become too big and bureaucratic to act quickly. That’s why traditional companies are looking at how start-ups think and function. Companies that want to innovate will have already read the 2011 bestseller called The Lean Start-up by Eric Ries. The book describes how successful start-ups launch a minimum viable product on very quickly and subsequently market-test it. And if the product they’ve developed isn’t an instant hit, the start-up ‘pivots’ it until it achieves success.

By Martijn Lofvers

Following the success of that book, Ries realized that established companies struggle to experiment with new products and new business models quickly without losing existing customers. In his new book, called The Start-up Method, he explains how a growing company can retain a culture of entrepreneurship without becoming bureaucratic.

The growing interest in start-ups prompted me to start exploring this aspect of business in more depth myself. In December 2017 I ran a session for an international group of supply chain executives at Start-upbootcamp in Amsterdam, during which three start-ups pitched their propositions just like in the BBC programme Dragons’ Den. Each of the supply chain executives received EUR250,000 worth of casino chips to invest in the new companies, and this approach generated very enthusiastic feedback. I was asked how many supply chain start-ups I knew of. That question triggered a lot of research over the past six months, the results of which can be found in our European Supply Chain Start-up Positioning Matrix. We extensively analysed a total of 53 start-ups from across Europe and contacted them for input. Notably, the start-ups have secured more than EUR160 million worth of capital between them. It seems that investors regard them as a highly promising market.

Supply chain directors are interested in start-ups in order to see which refreshing solutions they offer, but they need to keep innovating within their own companies too. In effect, I see my own company Supply Chain Media (publisher of this magazine) as an eternal start-up that is continually on the lookout for new trends and business models – and that’s why we’ve launched another new initiative, the inNOWvate event including its own Start-up Contest, to be held on 24 May.